As the turbulent economy drives up education loan defaults and college graduates find it difficult to enter the employment market, an increasing number of students are gambling on less-expensive schools and courses in trying to avoid needing to take on massive debt, writes Melissa Korn in the Wall Street Journal.
A report of about 1,600 students and parents from student-loan company Sallie Mae shows that more students are choosing lower-cost public colleges or commuting to schools from home to save on housing expenses.
Families across all income brackets are spending 9% less on college in 2010-11 compared to the previous year, based on the report. High-income families cut their college spending by 18%, to $25,760.
Having a college degree undeniably gives candidates an advantage in the employment market. And the stats back it up. The unemployment rate for people with a bachelor’s degree was 4.9% last month, compared with 10.5% for high-school graduates without any degree, according to the Bureau of Labor Statistics.
“When a work recruiter examines an Ivy League degree, they will usually view it more carefully,” says Elena Bajic, founder and CEO of Ivy Exec, a web-based executive job search site, reports Mark Koba at CNBC.com.
“An Ivy League education makes a candidate stick out, even before a recruiter foretells them.”
Besides a high-profile degree, Ivy League schools provide a social network that other schools can’t duplicate-emphasizing it’s whom you know as much as what you know, says Brian Eberman, CEO of StudentAdvisor.com, instruction comparison site.
“From an undergraduate perspective, the main advantage of Harvard or Yale is the connections that college creates between your students and their peers,” Eberman explains.
“Those connections can be very valuable over time when it comes to jobs and salaries.”
But a degree from a private college also is expensive and piles on debt. The typical debt load for students who got loans hit a record $27,200 for the class that graduated this year, says Mark Kantrowitz, publisher of student-aid websites Fastweb.com and FinAid.org.
That comes as general per capita debt reached $47,260 within the second quarter, an amount that has been dropping in recent years, according to the Federal Reserve Bank of New York.
Good news for all those students which are trying to avoid these huge debts – not everybody who wants to climb the corporate ladder needs to be an Ivy Leaguer. And that\’s according to Katherine Cohen, CEO and founding father of IvyWise, a private college admissions counseling company located in Manhattan.
“A lot of our nation’s political leaders and Fortune 500 CEOs came out of Ivy League schools, but there are still many more who did not and succeeded,” Cohen explains. “Employers tend to be more interested now in what a student has made of his or her college experience.”